The Narendra Modi government is ready to implement its new tax regime viz., GST (Goods and Service Tax) from the month of July 2017. They have now announced the applicable tax rates for some 1211 products. The Finance minister Arun Jaitley is telling that under this new tax regime tax filing will become simple and so tax buoyancy and government’s tax revenues will increase which will be good for the economic growth of India. As usual, government is selling GST to public as something that is good, no great, for the Indian economy, but is it so?
Firstly, to think that some new tax system will help the Indian economy grow is a sign of extreme ignorance about the nature of taxes itself. As Murray Rothbard said,
There can be no such thing as “fairness in taxation.” Taxation is nothing but organized theft, and the concept of a “fair tax” is therefore every bit as absurd as that of “fair theft.”
Since the very fact of taxation is an interference with the free market, it is particularly incongruous and incorrect (for advocates of a free market) to advocate uniformity of taxation.
Because tax is nothing but an organized system of robbery, the only good tax regime is the one which reduces the tax rate to zero, period. Is GST going to do that? Not at all. In fact, the highest tax rate under GST now is 28%. The Finance Minister Arun Jaitley is saying that GST will increase tax buoyancy and so increase government’s revenue (sic). This only means that the level of robbery in the economy will now increase. Government will siphon off income of productive people and use it to boost its own wasteful spending. This can never be good for any economy. Anything that makes the state, which is a parasitic institution in any society, bigger can never be good for the society and economy. GST is the same old wine of robbery in a new fancy named bottle! To think otherwise will be like fooling oneself.